Correlation Between Analog Devices and Sabra Healthcare
Can any of the company-specific risk be diversified away by investing in both Analog Devices and Sabra Healthcare at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Analog Devices and Sabra Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Analog Devices and Sabra Healthcare REIT, you can compare the effects of market volatilities on Analog Devices and Sabra Healthcare and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Analog Devices with a short position of Sabra Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Analog Devices and Sabra Healthcare.
Diversification Opportunities for Analog Devices and Sabra Healthcare
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Analog and Sabra is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Analog Devices and Sabra Healthcare REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabra Healthcare REIT and Analog Devices is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Analog Devices are associated (or correlated) with Sabra Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabra Healthcare REIT has no effect on the direction of Analog Devices i.e., Analog Devices and Sabra Healthcare go up and down completely randomly.
Pair Corralation between Analog Devices and Sabra Healthcare
Considering the 90-day investment horizon Analog Devices is expected to under-perform the Sabra Healthcare. In addition to that, Analog Devices is 1.04 times more volatile than Sabra Healthcare REIT. It trades about -0.12 of its total potential returns per unit of risk. Sabra Healthcare REIT is currently generating about -0.03 per unit of volatility. If you would invest 1,926 in Sabra Healthcare REIT on August 31, 2024 and sell it today you would lose (35.00) from holding Sabra Healthcare REIT or give up 1.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Analog Devices vs. Sabra Healthcare REIT
Performance |
| Timeline |
| Analog Devices |
| Sabra Healthcare REIT |
Analog Devices and Sabra Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Analog Devices and Sabra Healthcare
The main advantage of trading using opposite Analog Devices and Sabra Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Analog Devices position performs unexpectedly, Sabra Healthcare can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Sabra Healthcare will offset losses from the drop in Sabra Healthcare's long position.| Analog Devices vs. MACOM Technology Solutions | Analog Devices vs. FormFactor | Analog Devices vs. MaxLinear | Analog Devices vs. nLIGHT Inc |
| Sabra Healthcare vs. LTC Properties | Sabra Healthcare vs. Healthpeak Properties | Sabra Healthcare vs. Omega Healthcare Investors | Sabra Healthcare vs. Ventas Inc |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Commodity Directory Find actively traded commodities issued by global exchanges |